Decomposing Productivity Growth in the U.S. Computer Industry

38 Pages Posted: 11 Oct 2002 Last revised: 3 Feb 2015

See all articles by Hyunbae Chun

Hyunbae Chun

Sogang University - Department of Economics

M. Ishaq Nadiri

New York University (NYU) - Department of Economics; National Bureau of Economic Research (NBER)

Date Written: October 2002

Abstract

In this paper, we examine the sources of the productivity growth in the U.S. computer industry from 1978 to 1999. We estimate a joint production model of output quantity and quality that distinguishes two types of technological changes: process and product innovations. Based on the estimation results, we decompose total factor productivity (TFP) growth rate into the contributions of process and product innovations and scale economies. The results show that product innovation associated with better quality accounts for about 30 percent of the TFP growth in the computer industry. Furthermore, we find that the TFP acceleration in the computer industry in the late 1990s is mainly derived from a rapid increase in product innovation.

Suggested Citation

Chun, Hyunbae and Nadiri, M. Ishaq, Decomposing Productivity Growth in the U.S. Computer Industry (October 2002). NBER Working Paper No. w9267. Available at SSRN: https://ssrn.com/abstract=338874

Hyunbae Chun

Sogang University - Department of Economics ( email )

Seoul, 121-742
Korea, Republic of (South Korea)
+82-2-705-8515 (Phone)
+82-2-704-8599 (Fax)

HOME PAGE: http://hompi.sogang.ac.kr/hchun/

M. Ishaq Nadiri (Contact Author)

New York University (NYU) - Department of Economics ( email )

269 Mercer Street, 7th Floor
New York, NY 10011
United States
212-998-8968 (Phone)
212-995-4013 (Fax)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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